Smith v. Xerox Corp.

• Citation: 602 F.3d 320
• Decision Date: 24 March 2010
• Docket Number: No. 08-11115.,08-11115.
• Parties: Kim Y. SMITH, Plaintiff-Appellee, v. XEROX CORP., Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

602 F.3d 320

Kim Y. SMITH, Plaintiff-Appellee, v. XEROX CORP., Defendant-Appellant.

No. 08-11115.

United States Court of Appeals, Fifth Circuit.

March 24, 2010.

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Robert Daniel Martinez (argued), Richard Keys Disney, Cotten, Schmidt & Abbott, L.L.P., David Lynn Fielding, Laura Hilton Hallmon, Fielding, Parker & Hallmon, L.L.P., Fort Worth, TX, for Smith.

Michael Vance Powell (argued), Phillip R. Jones, Kelly Joellen Thurman, Locke, Lord, Bissell & Liddell, L.L.P., Dallas, TX, for Defendant-Appellant.

Jay K. Rutherford, Jackson Walker, L.L.P., Fort Worth, TX, for Amicus Curiae, Texas Ass'n of Business.

Before REAVLEY, JOLLY, and WIENER, Circuit Judges.

REAVLEY, Circuit Judge:

Xerox Corporation appeals following a jury verdict in favor of its former employee, Kim Smith, finding that Xerox terminated Smith in retaliation for her filing a complaint with the Equal Employment Opportunity Commission (EEOC), in violation of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e-3(a). Xerox challenges the jury instructions on a mixed-motive theory of causation, as well as the sufficiency of the evidence. We conclude that the district court instructed the jury on the proper causation standard and that the evidence was sufficient for the jury to assess liability but that the evidence was insufficient to support an award of punitive damages. We therefore AFFIRM the district court's judgment except to vacate the award of punitive damages.

I.

Kim Y. Smith was employed by Xerox Corporation for approximately 22 years before she was terminated in January 2006. During the time relevant to this case, she worked as an Office Solutions Specialist (OSS), responsible for supporting Xerox dealers, or "agents," who placed and serviced copying equipment in North Texas. For the majority of her employment, Smith received positive evaluations. By all accounts she was a very good employee who only two years before her termination was named to Xerox's prestigious President's Club, an annual award that is bestowed on only the top eight performing employees in the country.

In January 2005 Steve Jankowski took over as manager of Xerox's Central Region, which included the territory assigned to Smith. At the same time, the sales territories within Smith's region were realigned. As a result, Smith's territory and the number of agents that she supported were reduced. The reduction was significant to Smith because the ability of a Xerox OSS to meet sales goals is dependent in part on the number of agents with whom she works. Smith and Jankowski clashed from the beginning over the size of Smith's territory and subsequent problems that Smith had in meeting her sales goals.

Smith alleged in her complaint that upon becoming her manager Jankowski immediately began making negative employment decisions about her based on Smith's gender and age. She contended that while the size of her sales territory was decreased, the size of her sales goals, or "plan," was not adjusted accordingly. She alleged that when she complained about these changes, Jankowski gave her no support or guidance and instead simply insisted that she "make plan." But Smith was unable to meet the goals set for her. She attributed her failure to the unreasonableness of the sales goals, which she believed were not similarly required of other younger or male co-workers.

By March 2005, Jankowski indicated to Smith that she was behind in her goals and that he was concerned about Smith "making plan." In June 2005 Jankowski sent Smith a formal warning letter, which outlined various deficiencies in Smith's performance and placed her on a 90-day warning period. The letter indicated that Smith was currently at only 63% of her revenue goals and that she was "below expectations" in several areas. Jankowski later revised the letter to correct certain errors therein and re-started the warning period. The 90-day period was the first step in Xerox's Performance Improvement Process (PIP) and was set to end on October 25, 2005. Smith refused to sign the warning letter because she believed it was inaccurate. Instead, she sought a meeting with Jankowski's supervisor, Jack Thompson, and also complained to a Xerox human resources manager, Joe Villa, all to no avail.

On October 27, 2005, at the conclusion of Smith's warning period, Jankowski placed Smith on a 60-day probationary term, which was to expire on December 28, 2005. Jankowski's letter to Smith informing her of the probation stated in part that Smith had met approximately only 70% of her revenue plan and had also failed in other performance areas. The letter warned Smith that failure to meet a satisfactory performance level, including making up her entire year's shortfall and meeting 100% of her revenue plan, could result in termination of employment at the conclusion of the probationary period, or sooner if there were no evidence of improvement in the early stages of the period.

On November 4, 2005, Smith responded in writing to Jankowski's letter. She agreed that she was not at her plan goals but disagreed with Jankowski's assessment of other performance areas. She contended that the goals set for her did not reflect the "real world sales environment," including the decrease in her territory, and that she was not being treated the same as other employees or given the same amount of time usually offered when someone misses her sales numbers. Smith asked Jankowski to reconsider the length of her time on probation. Jankowski indicated on November 8, 2005, that he did not believe he was treating Smith differently from any other employee on the team and that he would not reconsider his position on the length of Smith's probation.

On November 17, 2005, Smith notified Jankowski that she had filed a discrimination charge against Xerox with the EEOC. Smith charged in her EEOC complaint that Jankowski had placed her in the Performance Improvement Process with the intention of terminating her employment and that he had done so based on her age, gender, and race. Smith's letter advised Jankowski of the law's prohibition of an employer taking action against an employee in retaliation for filing such charges.

Smith was terminated in January 2006 at the conclusion of her probationary period, at which point she had achieved approximately 74% of her revenue goals. Smith contends, however, that Jankwoski actually began the termination process much sooner, only days after she filed her EEOC charge, thereby truncating the probationary period in a way contrary to Xerox's established policies and procedures. For example, the record contains an involuntary termination request form seeking Smith's termination that appears to follow a fax cover sheet to the human resources department dated November 29, 2005, only seven business days after Smith filed her EEOC complaint.¹

On December 8, 2005, Jankowski sent Smith a written warning in the form of a "letter of concern," contending that Smith had submitted two inaccurate expense reports in October and November. The letter of concern accused Smith of submitting a reimbursement request for driving 161 business miles on a day she was actually on vacation and of improperly requesting a $54 reimbursement for a car wash for her personal vehicle. Smith withdrew the claim for the car wash reimbursement, stating that although she had washed both her personal and company vehicles on the same day, she could not find the receipt for the company vehicle and had mistakenly included the receipt for her personal vehicle when she submitted the expense report. She also explained that although she was on vacation on the day for which she requested mileage reimbursement, she had also visited a customer and attended a company sponsored conference, and she believed the miles should be considered business miles. Joe Villa testified about the letter of concern that it would violate company policy if Jankowski had sent it before speaking to Smith to get her explanation. When asked if the letter appeared to be evidence of someone lashing out or retaliating against Smith, Villa agreed that the letter was suspicious.

Smith's 60-day probationary period, during which she was expected to meet 100% of her revenue plan, officially ended on December 28, 2005. The involuntary termination request form, which appeared to follow the fax cover sheet dated November 29, 2005, bears a date for Jankowski's signature of January 3, 2006. Villa purportedly signed the document on January 4, 2006. Smith testified that revenue numbers typically are not available, however, until five to ten working days following the conclusion of the month. Xerox submitted Smith's revenue numbers to the EEOC on a form compiled on January 7, 2006, three days after Villa signed Smith's termination form. Smith was informed of her termination on January 13, 2006, while her EEOC charge was still pending. She subsequently filed a retaliation charge with the EEOC.

The EEOC issued a right-to-sue letter, and Smith filed the instant lawsuit, alleging that Xerox discriminated against her based on her gender and age and then retaliated against her for filing her EEOC charges, in violation of Title VII. The case proceeded to trial by jury. Over Xerox's objection, the district court concluded that the case had been tried as a mixed-motive retaliation case and instructed the jury on a mixed-motive theory of causation. Xerox argued that the proper instruction should have required Smith to prove but-for causation, but the district court disagreed.

The jury returned a verdict in favor of Xerox on the discrimination charge, finding that Xerox had not discriminated against Smith on the basis of either gender or age. On the retaliation claim, however, the jury found for Smith. It concluded in a special interrogatory that Smith proved her EEOC charge was a motivating factor in Xerox's termination decision. It then found that Xerox failed to show...